4 Solving for perfect subsitutes part 2

In this tutorial, the expert delves into perfect substitutes' intuition, building upon previous problem-solving methods. They explain marginal utilities of X and Y, representing extra utility gained per unit, and introduce indifference curves with CU/A + BY = constant utility. The slope of these curves represents the marginal rate of substitution, contrasting with the market's marginal rate of transformation. By comparing A/PX vs B/PY, one determines where to allocate resources for optimal utility per pound spent. Subscribe to @AxiomTutoring for more insightful economics lessons.